CME: Mixed Signals For Milk Futures

US - Blocks and barrels moved in opposite directions this morning, sending a mixed signal to milk futures, writes Alan Levitt.
calendar icon 13 October 2011
clock icon 1 minute read

Blocks were offered 2¢ lower, barrels traded a penny higher.

Class III contracts settled -13¢ to +5¢. Cheese futures also were mixed.

Spot butter was bid higher again, giving butter futures a boost. Whey futures were mostly higher as well.

USDA lowered its estimate of 2011/12 corn prices by 30¢/bushel in the “World Agricultural Supply and Demand Estimates” report.

Reductions in the projected harvest were offset by larger beginning stocks and smaller exports. On balance, projected carryout stocks were increased 194 million bushels to 866 million bushels.

The ending stocks-to-use ratio was raised from 5.3 per cent to 6.8 per cent. The average farm price for the marketing year is forecast to be $6.20-$7.20/bushel, up nearly 30 per cent from this year’s average (see chart).

Corn futures declined 4-7¢ today after yesterday’s surprising rally.

Congress is scheduled to vote tonight (12/10/11) on pending trade agreements with South Korea, Panama and Colombia. South Korea was the number one export market for US cheese in the April-July period with shipments of 30.5 million lbs, more than double the volume of the same period prior year.

Through July, overall US dairy exports to South Korea were valued at $145 million, up 97 per cent from a year ago. South Korea was our sixth-largest export market and had the largest percentage increase among the top 16.

Further Reading

- You can view the full report by clicking here.

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